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TITAN INDUSTRIES LIMITED

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TITAN INDUSTRIES LIMITED

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    1. TITAN INDUSTRIES LIMITED 5th August 2009 ‘Delivering value by creating desirable brands’

    2. Disclaimer

    4. Titan Industries Pioneer Breaker of rules Leader in two businesses:premium and mass market Manufacturer, designer, brand owner, marketer, retailer and after-sales service provider Unique culture First company to dare to challenge the Swiss B2C and B2B player In four businesses from 2007-08 One of the Jewels of the Tata Group

    5. Our Heritage – the TATA Group Titan is a part of the TATA Group having a turnover of about USD 30 bn, equivalent to over 2.5% of India’s GDP and having the biggest market capitalization in India The Tata group is India’s largest employer in the private sector – 222,000+ employees across 85 companies The TATA group has achieved many Firsts for India: First private sector Steel mill First private sector Power utility First luxury hotel (Taj) First Airline (now Air India) The World’s least expensive car (Tata Nano) India’s largest software company (TCS) India’s largest watch & jewellery mfgr (Titan)

    6. About Us Titan is the world’s fifth largest, integrated manufacturer-brand for watches Commencing production in 1986-87, the Company is today the leader in the Watch & Jewellery businesses in India First & largest player in the branded jewellery segment (Tanishq) >60% share of the organised watch market Over 90 million watches sold across 30 countries, cumulatively Manufacturing Facilities Main Watch & Jewellery plants in Hosur near Bangalore (India’s “Silicon Plateau”) Watch assembly plants at Dehradun, Baddi, and Roorkee. ECB plant in Goa; Jewellery-making facility at Dehradun Investment of US$150 million in 450,000 sq.ft. state-of-the-art manufacturing facilities Owned by Tata: 25.17% and TIDCO: 27.88% Professionally managed by TATA group & an independent Board

    7. Recognition and Awards in many categories

    8. Our businesses

    9. Our Brands

    10. Our businesses

    13. 2008-09 – continued growth despite the slowdown Financials Company Income crossed Rs 3750 Crores (US$ 750 million) PBT crossed Rs 230 Crores (US$ 46 million) Brands Brand Tanishq crossed Rs 2370 Crores (US$ 475 million) Brand GoldPlus crossed Rs 390 Crores (US$ 78 million) Brand Fastrack crossed 1.50 million watches Retailing World of Titan stores crossed 250 Tanishq and GoldPlus outlets touched 150 New Business Titan Eye+ outlets reached 70 (from 10)

    14. THE THREE YEAR JOURNEY… INCOME

    15. THE THREE YEAR JOURNEY… CAPITAL EMPLOYED

    16. THE THREE YEAR JOURNEY… COMPANY PROFITABILITY

    17. Market Capitalisation (Rs. Crores)

    18. 2009-10 PERFORMANCE FIRST QUARTER

    19. Watch revenues and results were positively impacted by the improved product mix from higher sales of Fastrack and Titan watches (due to wedding season) and the successful re-launch of Sonata after completion of the planned down-stocking in Q4. Jewellery sales were impacted by the high Gold prices. Sales increased by 3% in value terms, but with a Gold price increase of almost 20% the volume de-growth of Q4 continued in Q1. Results were also impacted by the adoption of AS 30 and inventory valuation by FIFO. The Eyewear chain grew from 69 to 77 outlets and the Company continues to invest in this business which will continue to grow and break even only by 2012. Precision Engineering made a small loss due to deferral of deliveries at the request of several customers. It is expected to break even once again, by Q2.

    20. PERFORMANCE – 2009-10 – FIRST QUARTER INCOME

    21. PERFORMANCE – 2009-10 – FIRST QUARTER

    22. PERFORMANCE – 2009-10 – FIRST QUARTER CAPITAL EMPLOYED (END JUNE)

    25. I Watch Business

    26. The Watch Market & Industry in India India is an under-penetrated market for watches – only 27 % of Indians own a watch Total estimated market in 2008-09 Volume ~ 43.5 mn units & Value: Rs 3000 Crores (USD 600 Mn) Vast proportion of the Indian market is below Rs 500 ~ 68% (85% by volume) Market has been split into: Low end, Mass market, Premium,Luxury

    29. INTERNATIONAL BUSINESS One of India’s first companies to market a consumer brand overseas. Now present in 26 countries outside India Among the top 3 brands in some Asian countries Selling over 675k watches annually with increasing presence in jewellery. Total export sales of over Rs 130 crores in 2008-09

    30. II Jewellery Business

    31. Jewellery – Market & Industry highlights

    33. Gold Plus :Size of the opportunity Semi-urban and rural market estimated to be as much as 40% of the total : Over Rs 30,000 crs. Value conscious consumers, buying traditional jewellery Very fragmented industry with under-karatage still prevalent in many parts of the country A new business model and a new brand to exploit this opportunity Sales of Rs 95 crs in 2006-07,Rs 200 crs in 2007-08 and Rs 390 crs in 2008-09 30 outlets as at 31 March 2009

    35. IV Precision Engineering Business

    36. Precision Engineering Business Rationale Leveraging Engineering capabilities B2B business – balances risk of B2C businesses The Opportunity India growing as a manufacturing base for precision products across industries Cost pressures and offset requirements guarantee a long term opportunity High cost of switching for customers Large & growing market: The global market for precision engineering products addressable by Titan is Rs.135,000 cr.

    40. Precision Engineering Business The Customers Eaton, US Bosch, India Hamilton Sunstrand, US Lucas, India Microtechnica, Italy Tata Motors, India Schlumberger, US Timken, India Ford, UK Turbo Energy, India Visteon, US / India Stanadyne, India Tyco Electronics, India The Achievement Achieved a turnover of Rs 76 crores in 2008-09 (up from Rs 56 crores in 2007-08) Achieved break-even for the year Targeting a turnover of Rs 83 crores in 2009-10

    41. THE EYE WEAR BUSINESS Started in 2004-05 by marketing Sunglasses under the Fastrack brand Targeted the youth segment Pilot project for Prescription Eyewear started in March 2007 Achieved a sales turnover of over Rs 66 crores in 2008-09 up from Rs 40 crores in 2007-08 70 Titan Eye+ outlets as on 31 March 2009

    42. THE EYEWEAR MARKET – AN UNTAPPED OPPORTUNITY Growth: Market has been growing in double digits ~ 15-20% per annum and likely to sustain Demand drivers: Urbanization, literacy, Penetration of TV & computers, Poor eye health due to lifestyles/ improper diet, etc. Margins: Overall mark ups of up to 300% exist between landed cost & retail price!

    43. OUR BUSINESS PROPOSITION Product / Service Offering: Eye checking, Optometry Range of frames - Titan & licensed brands Range of Branded Lenses Sunglasses – Titan, Fastrack & licensed brands Contact Lenses, Accessories

    46. 2009-10 Turnover to grow by about 20% over previous year (at constant gold prices), to target Rs 4,600 crores Operating Profit to grow in similar fashion Continued retail network expansion

    47. The Five Year Story….Multiple Businesses, Brands & Geographies

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